Coquest

Your Daily Energy Report for February 27, 2025

Posted on 2025-02-27

Crude Oil

Crude Oil futures for April settled up $1.73 or 2.521% at $70.35. Oil prices climbed on Thursday, rebounding from the previous session’s two-month low of $68.62 as concerns over supply disruptions emerged. U.S. President Trump announced a reversal of a decision made under the Biden administration, revoking a license that had allowed Chevron to continue operations in Venezuela. This move is expected to impact global supply, as Chevron currently exports approximately 240,000 barrels per day from the country. Meanwhile, data from the EIA revealed an unexpected increase in U.S. fuel inventories, with gasoline and distillate stockpiles rising even as crude oil reserves declined. Trump also indicated plans to swiftly replenish the Strategic Petroleum Reserve (SPR), criticizing Biden’s previous strategy of tapping into it to lower fuel prices.
 

Natural Gas

Natural Gas futures for April settled down -$.025 or -.631% at $3.934. Natural gas prices dropped today following the latest EIA report, which showed a 261 Bcf drawdown in storage last week—aligning with market expectations and further expanding the supply deficit compared to both last year and the five-year average. Market participants are also keeping a close eye on upcoming weather patterns, as near-term demand remains subdued with forecasts pointing to mild conditions at the beginning of March. Despite weaker demand, storage levels remain significantly below historical averages, which could lend some support to prices. Meanwhile, natural gas output in the Lower 48 states rebounded to 105.2 Bcfd as of February 27, recovering from the 100.5 Bcfd low recorded on February 19 when freeze-offs temporarily disrupted production. Looking ahead, forecasters anticipate above-average temperatures across much of the Lower 48 through mid-March, which may limit the potential for further price increases.

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